Thursday 02/07/13

I set out this week to better understand the relationship between the across-the-board federal budget cuts known as sequestration cuts. I was trying to figure out a little bit about how the cuts affect the USDA budget baseline and the farm bill.

I probably failed in that regard. Here's what I learned. The sequestration cuts that are supposed to take place March 1 could cut 8.2% from most farm programs. According to a White House Office of Management and Budget report last fall, the program cuts at USDA programs would add up to about $2.47 billion this year alone.

No, that's not right. The Congressional Budget Office cited a percentage cut for fiscal 2013 budget figures of 5.3% in a report released Monday. It's a single percentage number on page 14 of the report. How in the world I missed that valuable piece of information I will never know.

The CBO also put out a report for USDA programs showing an increased baseline on farm programs of $6 billion over 10 years from $970 billion to $976 billion.

No, that's not right either. Because the CBO report on USDA programs didn't actually factor in the impact of the 5.3% sequestration cuts because those cuts haven't actually happened yet.

The one group that put out some detailed information on these issues, the National Sustainable Agriculture Coalition, said the sequestration cuts at USDA would amount to about $7 billion over a nine-year period.

OK, so the baseline that added $6 billion over 10 years failed to account for the $7 billion reduction over nine years. In reality, the budget for the farm bill somehow would have $1 billion less to work with than there would have otherwise been.

Then a $2.47 billion cut this year actually translates over 10 years to not actually being that big a deal, right?

How do these cuts play out and exactly which programs are affected? That's kind of important because somewhere there is someone who might not be eligible or funded for a program in which that person had already assumed was funded. Let's say, for instance, a local conservation staffer assured a farmer that guy was next in line for an Environmental Quality Incentives Program cost-share so all the guy has to do is go ahead and start. Are those projects all set or funded for 2013? Is EQIP a possible program that could face a cut?

Are the direct payments going to be funded for 2013 as guaranteed or are they going to take a nick as well?

This is where my federal merry-go-round began last week. A helpful House staffer told me that, yes, direct payments would take an 8.2% cut. No, wait, that can't be right because the CBO report suggests 5.3% cuts. Crop insurance would be cut, I was told, but not until 2014. Well, the OMB report from last fall doesn't show crop insurance cuts. The CBO baseline is no help there, either.

For other information, I should direct my inquiries to the U.S. Department of Agriculture, which has 107,000 employees. Surely someone at USDA could competently explain the broad array of cuts to programs and how USDA plans to implement them. There has to be a memo somewhere, right? After all, there can't be an impetus to prepare for cuts in a particular program if the department faced with implementing the cuts doesn't have a handle on exactly where the axe will fall. According to reports, there also could furloughs among federal agencies. Could that affect local Farm Service Agency offices?

Agriculture Secretary Tom Vilsack has been telling us that rural America needs to make its voice heard when it comes to these federal budget issues because rural Americans aren't as relevant in the political world as they once were. That's a valid point. So please, USDA, can you provide me with some details on these sequestration cuts?

No. USDA isn't discussing it. All press inquiries about sequestration cuts have to go through the White House OMB.

Dear OMB, can you tell me how this is going to work? Silence. Prolonged silence. After all, I'm a peon journalist from rural America. I'm irrelevant to some guy responsible for handling press inquiries at OMB in Washington, D.C. Moreover, apparently from what I gather the administration that has preached transparency isn't being so transparent on how these cuts will fall. Yet, the president wants to stop the across-the-board cuts. You would think if you wanted to stop the cuts someone would suggest providing the public with a detailed accounting of where the cuts would fall. After all, you can't exactly get riled up about something affecting you if you don't know it's going to affect you in the first place.

As for congressional committees and trade associations who generally pay attention blow-by-blow to cuts to their favorite programs or agencies, in general they either don't know or they are simply laying low.

Well, screw 'em.

If the federal agencies faced with implementing across-the-board cuts can't adequately explain how these cuts will be applied, which programs are affected and exactly how much will be cut, then at least it's understandable why federal bureaucracy continues to sail along on like a rudderless ship.

If congressional committees aren't able to explain how these budget changes impact current federal programs or the ability to draft a new farm bill, then leaders of these committees shouldn't be surprised when there is no outcry from rural America over why we don't have a farm bill.

If the groups who covet certain programs in commodities, conservation, rural development or research can't adequately express their concern over possible cuts to their pet programs, then they ought not be surprised when they get whacked.

As for me, when I get details about exactly, how, when, where and why a particular program is no longer available, I'll pass that information along.

The rising tensions between China and Japan don't hold much promise for solving the "Farm Bill Issue", as if we're likely sucked into the mess, the "Sacred Cow" of the Defense Budget is more likely to get "after dinner mints" rather than some of the trimming it needs. This is sad as the Farm Bill is an investment in America's Supply Chain and Business growth foundation, one that, given a little time, could actually stimulate some real economic growth-badly NEEDED economic growth. If it even LOOKS like we might be on the road to WWIII, color that gone.

Posted by Ric Ohge at
10:12AM CST 02/07/13

Finally Chris, you make sense! You are not in trouble when you argue with yourself, only when you lose! Keep trying and thanks for the blog.
Snarky

Posted by Bonnie Dukowitz at
4:54PM CST 02/07/13

There are several other obvious and relevant facts that need to be part of this discussion. At the beginning of the past decade the government was guaranteeing a minimal amount of gross revenue per corn acre grown. Now many farmers receive a revenue guarantee of close to $1000 per acre of corn grown. Also the government was paying a minimal amount of insurance premium per acre. Now it is many billions per year. Some farmers now receive over a million dollars every year as a benefit towards the cost of their government crop insurance premium. Also the national debt has nearly tripled since the beginning of the last decade.

Tue Mar 3, 2015 02:09 PM CSTIowa businessman Bruce Rastetter put together the Iowa Agriculture Summit for Saturday with a lineup of confirmed speakers oriented heavily around Republican presidential candidates. The ag summit is expected to draw 900 Iowans as well as national media to cover the candidates and event.

Thu Feb 26, 2015 09:05 AM CSTFarm states are looking at a variety of options to generate revenue. Here are a couple of recent examples as Iowa and Kansas seek to address infrastructure or budget holes.

Wed Feb 25, 2015 08:58 AM CSTFormer Rep. Tom Latham, a Republican from Iowa, told a room of journalists, bloggers and public-relations staff late Tuesday afternoon that it would be a bad idea to reopen any aspect of the farm bill.

Mon Feb 23, 2015 02:32 PM CSTOmaha agricultural attorney David Domina gave his own perspective on the impacts of consolidation on farming in Nebraska during a speech Friday at the state's flagship university in Lincoln.

Fri Feb 20, 2015 10:05 PM CSTIn a statement emailed out just after 7 p.m. Pacific (9 p.m. Central) on Friday, the Pacific Maritime Association and the International Longshore and Warehouse Union announced they had reached a tentative agreement on a new five-year contract covering workers at all 29 West Coast ports.

Thu Feb 19, 2015 10:09 AM CSTSen. Jeff Flake released a parody of a BBQ sign on Wednesday as a way to keep the spotlight on a bill he helped introduce earlier this month. Flake and a few of his colleagues have embraced the proposal by President Barack Obama's FY 2016 budget to get rid of the premium subsidy for the Harvest Price Option on crop insurance.

Thu Feb 12, 2015 01:07 PM CSTRep. Mike Pompeo, a Republican from Kansas, lashed out Thursday at three Democrats in Congress for introducing a bill that would require labeling foods that have ingredients from biotech crops. The congressmen said lawmakers should "stop listening to celebrity chefs and well-heeled 'activists,' and start really caring about those less fortunate."

Tue Feb 10, 2015 07:12 AM CSTIt shouldn't surprise anyone that the crop-insurance industry came out of its annual convention over the weekend committed to fending off potential federal budget cuts. Crop insurers see themselves as under fire because of proposals in both Congress and the Obama administration that would cut spending on crop insurance anywhere from $220 million to $1.6 billion a year.

Mon Feb 9, 2015 05:07 PM CSTSupporters of country-of-origin labeling declared victory Monday that they had beaten back a federal lawsuit filed by the nation's meatpackers and other critics of the legislation. A bigger question was just how relevant the litigation is in the grand scheme of things because the World Trade Organization is going to tell everyone what is going to happen with COOL.

Tue Feb 3, 2015 08:19 PM CSTA day after the chairmen of the House and Senate Agriculture Committees scoffed at President Barack Obama's proposal to cut crop insurance, a pair of senators introduced a bill that would translate into significant cuts to crop insurance for the nation's largest farmers.

Tue Feb 3, 2015 03:19 PM CSTAhead of a scheduled joint hearing Wednesday of the Senate Environment and Public Works and House Transportation and Infrastructure committees on the waters of the U.S. rule to be finalized this spring, one congressman is pressing the U.S. Environmental Protection Agency to fully respond to a request for information about the agency's efforts to map potential waters of the U.S. that could become jurisdictional with the new rule.

Mon Feb 2, 2015 09:29 AM CSTAgriculture faces various studies and mixed signals when it comes to climate change. Farmers need to adapt yet many argue that agriculture also does more harm than good trying to mitigating greenhouse gases through biofuels.

Wed Jan 28, 2015 09:32 AM CSTVal Dolcini, head of the Farm Service Agency, is making the rounds to talk to producers about farm-program enrollment. I spoke to him briefly this week about the enrollment numbers and how FSA is getting the message out about the programs.

Mon Jan 26, 2015 09:56 AM CSTI was somewhat caught off-guard Friday when a few members of Practical Farmers of Iowa asked that I stick around their conference for a one-woman play performance. I was already facing an evening drive home and dinner from a drive-thru.

Sun Jan 18, 2015 09:47 AM CSTLate Saturday evening, the White House issued a fact sheet on a new tax proposal President Barack Obama will roll out Tuesday night at his State of the Union speech. The plan effectively increases taxes on wealthier people while offering some tax breaks for middle-class wage-earners.